LITIGATION RELEASE NO.17379 / February 25, 2002

The Securities and Exchange Commission announced that it filed a settled injunctive action on February 22, 2002 against California resident Christina Skousen, individually and doing business as CSK Securities Research.

The Commission's complaint alleged that between May 1999 and December 2000, Skousen, a self-styled "analyst," wrote fraudulent research reports touting eight microcap companies. Skousen's reports for seven of the companies contained false and misleading revenue, income and earnings. The revenue projections exceeded the companies' most recently reported revenue figures by as much as 260,913%, and exceeded the companies' most recently reported income figures by as much as 30,089%. Skousen's reports additionally failed to disclose that six of the companies required significant additional financing, which was not assured, to implement their business plans or continue in operation. Skousen's reports for the same seven companies also contained arbitrary projected stock prices, which exceeded the companies' current stock prices by as much as 18,650%. In addition, Skousen falsely represented that one company was "well-capitalized" when it had previously disclosed that it required additional working capital in order to continue as a going concern. Moreover, Skousen, who typically was paid in cash for all of the reports, failed to disclose her receipt of compensation in two instances where she personally published the reports.

The Commission's complaint alleges that Skousen violated Section 17(b) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks an injunction against Skousen and disgorgement of $30,000 and prejudgment interest and third-tier civil penalties. Without admitting or denying the Commission's allegations, Skousen has consented to the entry of an order that would enjoin her from future violations of the foregoing provisions and directing her to pay disgorgement and prejudgment interest. Under the proposed order, Skousen would not be required to pay disgorgement or civil penalties based on her demonstrated inability to pay.